The coronavirus relief bill unveiled by House Democrats Tuesday would not increase the credit union Member Business Loan cap or decrease capital standards—two major priorities of the NCUA and credit union trade groups.
The $3 trillion, 1,800-page bill includes about $1 trillion in aid to states and local government, as well as extended unemployment benefits and additional stimulus payments to taxpayers. It also would provide a safe harbor for financial institutions providing services to marijuana-related business.
The measure includes $1 billion in financial and technical assistance to Community Development Financial Institutions and adds an additional $5 billion to the CDFI fund to help small businesses. Of that total, $1.5 billion would be set aside for Minority Depository Institutions.
The bill also would allow non-profit organizations to gain access to the Federal Reserve’s Main Street Lending program.
The Democratic-controlled House may vote on the bill as soon as Friday, but the Republican-controlled Senate is expected to ignore it. It remains unclear when the Senate might want to consider another coronavirus relief measure.
House Democrats unveiled the measure on the same day that NCUA Chairman Rodney Hood was testifying on the other side of the Capitol. He asked the Senate Banking Committee to reduce the level at which credit unions are considered well-capitalized from a net-worth ratio of 7% to 6% and adequately capitalized from 6% to 5%. That provision was not included in the House Democrats’ bill.
NCUA board member Todd Harper, a Democrat, and Senate Banking Committee ranking Democrat Sherrod Brown of Ohio oppose decreasing the capital requirements.
Hood also asked to increase the Member Business Lending cap to 20% during the coronavirus recovery. That request also was ignored by House Democrats.
The member business lending and capitalization decrease also were on wish lists sent to Capitol Hill by credit union trade groups.
The House bill includes provisions of the so-called “SAFE Banking Act” that has passed the House. The bill would provide a safe harbor for financial institutions that choose to do business with marijuana-related businesses in states where cannabis is legal. The marijuana bill remains stalled in the Senate, where Banking Committee Chairman Mike Crapo (R-Id.) opposes it.